Dual sourcing under supply disruption with risk-averse suppliers in the sharing economy

Varun Gupta and Dmitry Ivanov

International Journal of Production Research, 2020, vol. 58, issue 1, 291-307

Abstract: Giant retailers sell their store brands and (re)sell substitute national brands for manufacturers (suppliers) simultaneously, which becomes an important sourcing and selling supply chain strategy in the sharing economy era. In this paper, we develop a game-theoretic model to examine the impact of risk-averse suppliers on dual sourcing decisions under supply disruption when two substitute products are sold in a common market. We examine the impact of risk-aversion, demand volatility, and supply disruption on the supply chain profitability and pricing policies. We hypothesise and then analytically derive several propositions on the dependencies of the profitability and risk-aversion, demand volatility and pricing, and risk-aversion and pricing. We also conduct numerical analysis to explore the impact of disruption. We offer insights for managers and researchers alike by uncovering the role of supplier risk-aversion for decision-making settings with substitute products and dual sourcing when product supply may be disrupted.

Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (18)

Downloads: (external link)
http://hdl.handle.net/10.1080/00207543.2019.1686189 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:tprsxx:v:58:y:2020:i:1:p:291-307

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/TPRS20

DOI: 10.1080/00207543.2019.1686189

Access Statistics for this article

International Journal of Production Research is currently edited by Professor A. Dolgui

More articles in International Journal of Production Research from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().